Natural gas price prediction – prices rise on cold weather forecast

Natural gas prices moved higher on Friday as colder than normal weather is expected to cover most of the mid-west for the next two weeks. This cooler weather will be offset by warmer than normal weather which is expected to cover the entire east coast.

The number of natural gas rigs increased by one in the latest week according to Baker Hughes. The total number of active oil and gas rigs increased for the week by 13, with oil rigs rising by 12 and gas rigs rising by 1. Total oil and gas rigs in the United States are now down by 569 compared to this time last year.

Natural gas prices rallied 1.1% on Friday, remaining above support near the 50-day moving average at 2.76. Resistance is seen near the October highs at 2.95. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.

Based on the U.S. Energy Information Administration’s (EIA) annual survey of electric generators, natural gas-fired generators accounted for 43% of operating U.S. electricity generating capacity in 2019. These natural gas-fired generators provided 39% of electricity generation in 2019, more than any other source.

Source: FX Empire

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